China’s general aviation (GA) industry has huge potential for future development, although it is constrained by limited economic scale, operational restrictions, and some competition factors.
While it has grown relatively rapidly, China’s GA sector has a tiny fleet of aircraft, about 2,800, consisting of 66 percent fixed-wing, 32 percent rotorcraft, and 2 percent airships and hot-air balloons. The city of Beijing and Sichuan, Heilongjiang, and Guangdong provinces are the primary locations of China’s GA aircraft.
In the first half of 2017, there were 345 licensed GA enterprises in China, according to the Civil Aviation Administration of China (CAAC). As of October 2017, the total flight time of GA aircraft reached 661,000 hours, up 2 percent year-over-year. Operators logged 764,700 hours in 2016. Industrial aviation operations logged 82,900 of those hours, accounting for 11 percent of total operations; agricultural and forestry aviation operations flew 51,000 hours or 7 percent of the total; and other GA operations accounted for the majority, at 630,800 hours.
Over the past few years, the GA industry has faced many problems, including an onerous and expensive regulatory climate and extremely limited access to Chinese airspace, which is subject to many external constraints. There are also many constraints on the supply side of China's GA businesses and operations, according to Yang Shuanchang, deputy director of the ministry of industry and information technology. Chinese society lacks a basic understanding on how to develop a GA industry. At the same time, the occurrence of some GA accidents has affected development of the industry.
To resolve those issues and encourage new economic development, the Chinese government put a special emphasis on GA in its 13th Five-Year Plan (2016-2020). The plan focused on six major points: safety, economic contribution, service level, an efficient airport network, the promotion of GA, and green development.
Infrastructure Investment
China has ambitions to build world-class aviation hubs and increase the number and distribution of regional airports. According to the plan, the number of GA airports will exceed 500 by 2020, with 578 new GA airports to be built under the provincial and enterprise planning process during 2017-2020, with an investment of more than ¥140 billion ($21.5 billion). These airports are expected to serve all prefecture-level cities, major agricultural production and forest areas, and at least half of the top-level tourist destinations. A well-established GA network could enable more people to travel by air, thus possibly helping to mitigate China’s “big city disease” problem by allowing people to live outside of major metropolitan areas.
According to the China GA Report 2017 issued by Asian Sky Group, by 2020 the coastal province Jiangsu will feature the most GA airports (71), followed by Yunnan (51), Xinjiang (47), Zhejiang (37), and Inner Mongolia (35). Transport times in many large provinces can be cut to less than an hour in GA aircraft, which will help improve communications and human resource deployment. Also, GA provides an ideal infrastructure for transporting rescue teams and resources to remote areas in the event of a natural disaster.
China currently has 75 CAAC-approved GA airports, the Asian Sky Group report noted, including 20 heliports, with eight airports located in Guangdong province, six in Shandong, five in Beijing, and five in Jiangsu province. Most of the airports are for fixed-wing GA traffic, and a few are heliports. Geographically, the majority of GA airports are located in the eastern provinces while western provinces have only eight airports.
Aside from the above approved airports, China has 204 non-certified fixed-wing GA airports, 33 heliports without certification, and more than 602 helipads or designated landing spots serving various mission segments. The majority of these landing spots are for emergency medical flights. Henan tops the other provinces with its 104 hospital-constructed landing spots. China intends to have 850 international-standardized bases for emergency air rescue by 2020.
GA airports are divided into A and B types, where A is open to the public and B is nonpublic. Under China’s GA airport classification management measures, released in April 2017, type A airports are categorized into three subtypes: A1, which are GA airports with commercial flights with an aircraft suitable for 10+ passengers; A2, GA airports with commercial flights with an aircraft suitable for five to nine passengers; and A3, all other airports not included in categories A1 and A2.
Among under-construction A1 and A2 airports, their locations include major agricultural production districts, forest regions, certified tourist attractions, territories with traffic issues, GA industrial zones, training schools, etc. A3 GA airport construction sites include highway service stops (for helipads), first-class hospitals (also helipads), qualified tourism areas, and more.
In parallel, China is working to develop GA industrial parks, which consolidate many GA activities such as manufacturing, training, and flight operations in one zone. Currently, many types of GA industrial parks are being planned or under construction, with more than 140 underway. For example, the Dingshu town local government in Wuxi, Jiangsu province, announced plans to build a GA industrial park with an investment of ¥1.2 billion ($184 million), part of Wuxi’s ¥5 billion fund for equity investment in GA. Dornier Seawings invested $298 million to build facilities to manufacture its all-composite amphibious turboprop at the Dingshu airpark. Wuzi vice mayor Wang Jinjian said that aviation is a good fit for the city’s economy.
The development of GA airports in China should coincide with some changes in management requirements implemented by the CAAC. For instance, the civil airport license regulations and civil airport security operation management regulations have been changed to provide greater autonomy to GA airports.
A number of policy documents on GA were developed during the last two years. The “Opinions on Promoting the Development of General Aviation Industry” guideline enacted by the state council in May 2016 was a key document for GA investors, aiming to help build a business-friendly environment. One estimate puts the value of China’s GA industry at ¥1 trillion ($150 billion) in the coming years. The number of GA aircraft is expected to reach 5,000, with annual flight hours surpassing 2 million, still far lower than the more than 210,000 GA aircraft in the U.S., which log an estimated 24 million flight hours annually.
The guideline targeted issues that hindered the industry's development such as a shortage of GA airports and slow progress in opening up low-altitude airspace to GA operations. The state council also recommends simplifying the approval procedures that GA aircraft operators need to go through before being able to take off and fly in China.
Many provincial governments have successfully introduced plans to build GA airports in their provinces and speed up the implementation of these plans. The trend of social capital investment in general-purpose airports is on the rise.